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Can global labour demand absorb India’s growing workforce?

By N.S. Venkataraman* 
Over the past eleven years, India has claimed significant economic growth, emerging as the world’s fourth-largest economy. With the Government of India continuing to pursue economic and industrial development initiatives, this growth momentum is expected to continue in the medium term.
Parallel efforts are being made to expand educational infrastructure and promote skill development across sectors. These initiatives are intended to improve employability and enable the workforce to access job opportunities both within India and overseas.
Despite these developments, employment generation remains a key challenge. While opportunities exist in both the organised and unorganised sectors, they have not kept pace with the growth of the working-age population. Technological changes such as automation, robotics, and artificial intelligence are also reshaping labour markets by reducing demand for certain traditional job roles. With a substantial proportion of the population consisting of young people seeking employment, labour market pressures are likely to persist unless employment creation expands significantly.
India’s population is currently estimated at approximately 1.4 to 1.5 billion. Although fertility rates have been declining and average family sizes are reducing, overall population growth continues due to demographic momentum. Projections suggest that India’s population could approach around 1.8 billion by 2050. In a country of this scale, generating adequate employment for all individuals in the working-age group presents a structural challenge.
India is now the most populous country in the world. Population density during the 2023–25 period is estimated to be between 480 and 492 persons per square kilometre. This figure is considerably higher than in many other countries, including the United States, Canada, Russia, China, Germany, and Kenya, highlighting the demographic pressure on land and resources.
In contrast, several developed economies, including Japan and many European countries, are experiencing stagnant or declining native populations. China’s population growth has also slowed and stabilised following long-term demographic trends influenced by earlier population policies. These shifts have raised concerns in some countries about the availability of labour to support economic activity, particularly in sectors requiring specialised skills.
As economies modernise and adopt advanced technologies, the demand for skilled and highly skilled workers has increased in many regions. Labour shortages in certain sectors have prompted destination countries, including those in Europe and the Middle East, to rely more on migrant workers to meet economic needs.
In this context, India’s large population and expanding skill development initiatives position it as a significant source of migrant labour. Overseas employment has become an important avenue for absorbing part of India’s workforce, particularly when domestic job creation does not fully meet demand.
India is reported to have the world’s largest emigrant population, with more than 18.5 million people of Indian origin residing abroad in 2024. Indian migrants account for an estimated six per cent of the global international migrant population. This trend is expected to continue as skill-based training expands and global demand for labour persists.
At the same time, migration has become a subject of policy debate in many destination countries. Issues related to social integration, cultural differences, and long-term demographic change are increasingly part of public and political discussions. While migrant labour contributes to economic activity, host countries are also assessing the social and demographic implications of sustained migration flows.
Against this backdrop, India’s population growth and international migration patterns highlight a set of interconnected economic, social, and demographic issues. Addressing domestic employment needs while engaging with global labour markets will remain an important policy consideration for India, even as destination countries continue to evaluate the broader impacts of migration on their societies.
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